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Smart Thought Of The Week: Sleep

Today, Friday 19 March 2021, is World Sleep Day. I bet you didn’t even know that there is a specific day in our calendar to celebrate something as routine as snoozing. But there is.

This is the 14th year that the event has been held. The slogan for this year is ‘Regular Sleep, Healthy Future’. It is a reminder to all of us about the importance of sleep to optimise our quality of life and improve global health.

The organiser has even come up with a 10-point tip-sheet to help us sleep better….

…. I particularly like recommendation number 10, which says that we should reserve our beds for sleep and sex and avoid using it for work and general recreation.

Can you see where I am going with this? Bear in mind that this is a family-friendly website.

That’s right. We should stop thinking about work when it is time for us to retire to our beds. In my case, I put my portfolio to sleep when it is time for me to enjoy my eight hours of shut-eye, too.

We can only do that if we have absolute confidence in the stocks we own. Sure, market will continue trading long after we are in the Land of Nod. They may even start trading whilst we are still in slumberland at the crack of dawn.

Markets never sleep. But just because they don’t sleep, it doesn’t mean we have to chase away the sandman, too….

…. Peter Lynch, who is arguably one of the best investors of our time, said: “A watched stock never boils” ….

…. Put another way, our job as long-term investors is to spend time during the waking day looking for good companies to put our money into. In other words, we need to do our homework.

As an income investor, I spend time looking for companies that can reward me with dividends through good times and bad. That is the time when I need to be alert. I can’t do that if I have been up half the night fretting over share prices.

But that’s not all.

I slot them into a portfolio that enables them to function in a synchronised way that could grow over time. They should continue to deliver dividends that can be reinvested into more shares to grow the portfolio.

And guess what? They should be able to do this day and night, which is probably why I never fail to get a good night’s sleep.

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David does not own shares in any of the companies mentioned.